Spring 2010 issue of Horizons

Raise Your Expectations CERTIFIED PUBLIC ACCOUNTANTS AND BUSINESS CONSULTANTS

if needed to put monies behind those areas giving you the biggest bang for the buck.

If your current lender is not able to service your needs, do not be afraid to look elsewhere for funds. State and local economic development organizations also may be able to assist with different funding options. 4. Modify payment terms with customers — When good customers run into problems, you can make a choice to stop conducting business with them or try to work with them. One option is to change the payment terms to push for cash on delivery. Consider offering discounts for cash or credit card payments. 5. Reduce inventory levels — Timing production or purchase of inventory to more closely coincide with orders and deliveries can free up funds used in purchasing and storage costs. Delaying payments until they are due can help with a cash crunch. 6. Decrease payroll costs — Letting employees go can be a difficult decision, especially if they have been hard-working and loyal colleagues. In lieu of that option, think about whether you can reduce their hours or not replace those who do leave so those remaining assume more duties. Of course, freezing or cutting salaries also are options that might make sense for your business. If you do need additional staff, consider engaging project resources to fill the gap on an interim basis. This provides you more flexibility to determine if a permanent employee is necessary. You might find that you can outsource some functions in a less costly way. 7. Continue marketing — While some businesses are quick to pull the plug on marketing, now is the time to make sure customers know you are still able to serve them. Take time to look at your marketing efforts to determine the impact and return on those dollars. Make adjustments If reduction in inventory levels frees up space, consider subleasing the space to another company.

Whatever changes are made in the organization, communication with your team is important so everyone knows the rationale and direction going forward. Everyone in the company has a role to play in making opportunities a reality for the long-term success of the business. Being creative in tough times can set the stage for a stronger organization when the economy improves. Weathering tough times often forces a re-focus on the business, especially on the proper allocation of resources and new priority areas that perhaps were less important previously. Priorities can change as the environment around us evolves. Having the flexibility to redefine strategy and make changes helps position the company for the future.

Questions? Contact:

Theresa Lynch Ruzicka, CPA Partner-in-Charge Entrepreneurial Services Group 314.290.3337 theresa.ruzicka@rubinbrown.com

16 u spring 2010 issue